Covidien surges on sale; Yahoo drops on Alibaba results

Tesla rallies after Marcus Hotels install charging stations

SaumyaVaishampayan

SAN FRANCISCO (MarketWatch) — Covidien PLC soared Monday following a deal with Medtronic Inc., while Yahoo Inc. shares were among the biggest losers in the S&P 500 after China’s Alibaba released more details on its financial performance.

Gainers

Covidien
US:COV
shares rose 21% after the company reached an agreement to be bought by rival Medtronic
MDT, -0.55%
in a cash-and-stock deal worth about $42.9 billion. The deal is expected to close in the fourth quarter of 2014 or early 2015. Shares of Medtronic reversed earlier gains to fall 1.4%.

Tesla Motors Inc.
TSLA, -0.94%
rallied 8.3% on news that Marcus Hotels and Resorts, owned by Marcus Corp.
MCS, +1.43%
will install power charging stations for Tesla cars at its properties in the United States.

Shares of Nuance Communications Inc.
NUAN, +1.34%
advanced 9.8% on a report that the company is in discussions to find a potential buyer. The speech-recognition software maker has held talks with Samsung Electronics Co. and private-equity firms, The Wall Street Journal reported. Nuance’s voice-powered technology is used in Samsung’s handsets and tablets as well as Apple Inc.’s Siri.

Decliners

Yahoo
YHOO, -1.15%
shares slid 5.1%. Alibaba, a Chinese e-commerce company in which Yahoo holds a large stake, reported its quarterly operating margin fell to 45.3% from 51.3% a year ago, The Wall Street Journal reported. Alibaba is in the process of listing its shares in the U.S. stock market.

Vertex Pharmaceuticals Inc.
VRTX, -2.71%
shares skidded 8%. Analysts at Bernstein Research said they are cautious on the stock due to expectations that the result from the company’s traffic and transport phase III program for its cystic fibrosis treatments Vx809 and Kalydeco is likely to be underwhelming. “Put simply, the basic science, the pharmacokinetics and the anecdotal feedback all point to a higher than expected probability of disappointment in this trial, which now seems likely to be announced in July,” said Geoffrey Porges at Bernstein in a report.

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